Earnings Miss: ZTO Express (Cayman) Inc. Missed EPS By 17% And Analysts Are Revising Their Forecasts

Last week, you might have seen that ZTO Express (Cayman) Inc. (NYSE:ZTO) released its interim result to the market. The early response was not positive, with shares down 3.8% to US$19.08 in the past week. It was not a great result overall. While revenues of CN¥12b were in line with analyst predictions, earnings were less than expected, missing statutory estimates by 17% to hit CN¥2.37 per share. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. We thought readers would find it interesting to see the analysts latest (statutory) post-earnings forecasts for next year.

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Taking into account the latest results, the current consensus from ZTO Express (Cayman)'s 25 analysts is for revenues of CN¥48.7b in 2025. This would reflect a reasonable 5.2% increase on its revenue over the past 12 months. Statutory earnings per share are forecast to reduce 6.6% to CN¥10.19 in the same period. Before this earnings report, the analysts had been forecasting revenues of CN¥49.9b and earnings per share (EPS) of CN¥11.44 in 2025. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a substantial drop in earnings per share estimates.

Check out our latest analysis for ZTO Express (Cayman)

The analysts made no major changes to their price target of US$23.58, suggesting the downgrades are not expected to have a long-term impact on ZTO Express (Cayman)'s valuation. That's not the only conclusion we can draw from this data however, as some investors also like to consider the spread in estimates when evaluating analyst price targets. There are some variant perceptions on ZTO Express (Cayman), with the most bullish analyst valuing it at US$28.18 and the most bearish at US$17.79 per share. The narrow spread of estimates could suggest that the business' future is relatively easy to value, or thatthe analysts have a strong view on its prospects.

Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. We can infer from the latest estimates that forecasts expect a continuation of ZTO Express (Cayman)'shistorical trends, as the 11% annualised revenue growth to the end of 2025 is roughly in line with the 13% annual growth over the past five years. By contrast, our data suggests that other companies (with analyst coverage) in a similar industry are forecast to see their revenues grow 3.0% per year. So although ZTO Express (Cayman) is expected to maintain its revenue growth rate, it's definitely expected to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that the analysts downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Regrettably, they also downgraded their revenue estimates, but the latest forecasts still imply the business will grow faster than the wider industry. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple ZTO Express (Cayman) analysts - going out to 2027, and you can see them free on our platform here.

Plus, you should also learn about the 1 warning sign we've spotted with ZTO Express (Cayman) .

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.